Jeff, a 52% owner of an S corporation, has a stock basis of zero at the beginning of the year. Jeff's basis in a $10,000 loan made to the corporation and evidenced by a corporate note has been reduced to zero by pass-through losses. During the year, Jeff's net share of the corporate taxable income is $11,000. At the end of the year, the corporation repays the loan principal to Jeff.

What are the tax effects for Jeff?

If an amount is zero, enter "0". The loan basis ____________, and the repayment of the loan principal to Jeff results in $_________ of taxable income. Jeff increases his basis in the S corporation stock by $________